Core Viewpoint - Gap's shares fell significantly after the company warned that tariffs could impact its profits by $150 million in 2025, despite reporting first-quarter earnings that exceeded expectations [1][7]. Financial Performance - Gap reported first-quarter earnings of 51 cents per share, surpassing Wall Street's forecast of 45 cents [7]. - Comparable sales increased by 2%, better than the expected 1.7% rise, while revenues grew by 2% to $3.5 billion [5]. - The company maintained its fiscal guidance, expecting sales growth of 1% to 2% and operating income growth of 8% to 10%, targeting $1.1 billion [7]. Tariff Impact - The company indicated that the potential effects of tariffs are not reflected in its current guidance, but if tariffs remain high, profits could be reduced by $100 to $150 million, primarily in the second half of the year [7][10]. - Tariff rates of 30% on goods made in China and 10% on goods from most other countries are particularly concerning for Gap's profit margins [10]. Strategic Initiatives - Under the leadership of Richard Dickson, Gap plans to double the use of America-grown cotton by 2026, emphasizing investment in the U.S. market [3]. - The company has diversified its supplier base, reducing its exposure to China to less than 10%, with a goal of no single country accounting for more than 25% of its supply chain by the end of 2026 [4]. Market Reactions - Following the tariff warning, Gap's shares dropped by 20%, reaching $22.40 [1]. - Several brokerages, including Jefferies, have lowered their price targets for Gap's stock, reflecting concerns about the need for reinvestment in brands like Banana Republic and Athleta to achieve consistent sales and margin growth [2].

Core Viewpoint - Gap Inc's stock has dropped significantly by 19.7% to $22.49 following a disappointing current-quarter guidance, which forecasts flat sales, failing to meet Wall Street's growth expectations [1] Group 1: Financial Performance - Despite the weak outlook, Gap reported a strong first quarter, beating earnings and revenue estimates with earnings of 51 cents per share on revenue of $3.46 billion [2] - Executives indicated that proposed tariff hikes by President Trump could result in a cost impact of $250 million to $300 million, although mitigation efforts may reduce this to $100 million to $150 million [2] Group 2: Analyst Reactions - At least four analysts have lowered their price targets for Gap, with Jefferies and UBS adjusting their targets to $26 and $17 from $29, respectively [3] - The current 12-month consensus target price still reflects a 22.6% premium over the current stock levels [3] Group 3: Stock Performance - The recent selloff has erased year-to-date gains, with the stock now down 4.4% and on track for a fifth consecutive daily loss, marking the worst weekly performance since 2021 [4] - The $22 level is acting as support, but the stock is likely to close below its 20-day moving average [4] Group 4: Options Market Activity - Options traders have reacted quickly, with over 32,000 calls and 30,000 puts traded, which is 14 times the average intraday volume [5] - The most active option is the weekly 5/30 22.50-strike put, with new positions being opened and set to expire at today's close [5]

Group 1: Contract Details - Lockheed Martin Corporation (LMT) secured a contract worth nearly $509.8 million from the U.S. Air Force for the development of GPS III Follow-On Space Vehicles 21 and 22, with completion projected by November 2031 [1] - The project includes advanced anti-jamming and anti-spoofing M-code technology to enhance military GPS signal access for the U.S. and allied forces [2] Group 2: Strategic Implications - This deal reinforces Lockheed's leadership in the space and defense sectors and highlights its technological capabilities, paving the way for future domestic and international contracts [3] - The rising geopolitical tensions and evolving threats have increased the demand for improved GPS solutions across various operational domains [4] Group 3: Industry Context - Lockheed Martin is actively developing next-generation GPS III/IIIF satellites as part of the U.S. Space Force's initiative to modernize the GPS network with enhanced capabilities [5] - Other defense companies, such as L3Harris Technologies, RTX Corporation, and Northrop Grumman, are also positioned to benefit from the military GPS market, each with their own specialized navigation solutions [6][7][8] Group 4: Stock Performance - Over the past three months, Lockheed shares have increased by 4.8%, while the industry has seen a growth of 11.8% [10] - Lockheed currently holds a Zacks Rank of 3 (Hold) [11]

Group 1: Elastic N.V. Performance - Elastic reported adjusted earnings of 47 cents per share, exceeding market estimates of 37 cents per share [1] - The company's sales reached $388.43 million, surpassing expectations of $380.36 million [1] - For the first quarter, Elastic anticipates adjusted EPS of 41 to 43 cents on sales between $396.00 million and $398.00 million [2] Group 2: Market Reactions - Elastic shares fell 9.7% to $83.23 in pre-market trading following the earnings report [2] - The Gap, Inc. saw a decline of 13.7% to $24.10 after reporting first-quarter results and warning of potential tariff costs of $250 million to $300 million [5] - The Cooper Companies, Inc. shares dropped 10% to $72.00 after second-quarter results [5] - Regeneron Pharmaceuticals, Inc. shares fell 8.8% to $552.00 despite meeting primary endpoints in one study [5] - Newsmax, Inc. declined 8.2% to $20.49 after filing for resale of up to 121 million shares [5] - IonQ, Inc. shares decreased by 7.4% to $40.01 [5] - American Eagle Outfitters, Inc. fell 7.2% to $10.38 after reporting disappointing first-quarter results [5] - Venu Holding Corporation dipped 6.1% to $12.10 after a previous gain [5] - NetApp, Inc. shares declined 5.2% to $94.00 following soft first-quarter guidance [5]

Core Insights - Gap reported revenue of $3.46 billion for the quarter ended April 2025, reflecting a 2.2% increase year-over-year and a surprise of +1.33% over the Zacks Consensus Estimate of $3.42 billion [1] - Earnings per share (EPS) for the quarter was $0.51, up from $0.41 in the same quarter last year, with an EPS surprise of +15.91% compared to the consensus estimate of $0.44 [1] Financial Performance - Comparable store sales increased by 2% year-over-year, surpassing the five-analyst average estimate of 1.5% [4] - Comparable store sales for Gap specifically rose by 5%, exceeding the five-analyst average estimate of 3.6% [4] - Comparable store sales for Old Navy increased by 3%, compared to the five-analyst average estimate of 1.4% [4] Store Metrics - The total number of company-operated stores was 2,496, slightly below the average estimate of 2,501 by four analysts [4] - Old Navy North America had 1,246 store locations, compared to the average estimate of 1,251 [4] - The total number of Banana Republic stores was 413, compared to the average estimate of 418 [4] Square Footage and Sales - The square footage for Banana Republic North America was 3.1 million square feet, slightly below the three-analyst average estimate of 3.13 million square feet [4] - Total square footage across all stores was 29.9 million square feet, exceeding the average estimate of 29.48 million square feet [4] - Net sales for Gap Global totaled $724 million, surpassing the average estimate of $700.37 million and representing a +5.1% year-over-year change [4] - Net sales for Banana Republic Global were $428 million, below the average estimate of $437.44 million, reflecting a -2.7% year-over-year change [4] - Net sales for Old Navy Global reached $1.98 billion, exceeding the average estimate of $1.93 billion and representing a +3.4% year-over-year change [4] Stock Performance - Gap's shares have returned +29% over the past month, significantly outperforming the Zacks S&P 500 composite's +6.7% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Group 1 - The conference call is regarding Gap, Inc.'s First Quarter 2025 earnings [1] - Whitney Notaro, Head of Investor Relations, is hosting the call [1] - The call includes forward-looking statements that may differ from actual results due to various risks [2][3] Group 2 - The company emphasizes the availability of cautionary statements in their latest earnings release and annual report [2] - The financial measures discussed may not align with generally accepted accounting principles [3]

Core Insights - Gap reported quarterly earnings of $0.51 per share, exceeding the Zacks Consensus Estimate of $0.44 per share, and showing an increase from $0.41 per share a year ago, representing an earnings surprise of 15.91% [1] - The company achieved revenues of $3.46 billion for the quarter ended April 2025, surpassing the Zacks Consensus Estimate by 1.33% and up from $3.39 billion year-over-year [2] - Gap shares have increased approximately 19.5% since the beginning of the year, significantly outperforming the S&P 500's gain of 0.1% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.59 on revenues of $3.75 billion, while the estimate for the current fiscal year is $2.32 on revenues of $15.3 billion [7] - The estimate revisions trend for Gap is mixed, leading to a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Context - The Retail - Apparel and Shoes industry, to which Gap belongs, is currently ranked in the bottom 37% of over 250 Zacks industries, suggesting potential challenges ahead [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact investor sentiment and stock performance [5]

Financial Performance - Net sales reached $35 billion, a 2% increase year-over-year, with comparable sales also up by 2%[13] - Gross margin expanded by 60 bps compared to the previous year, reaching 418%[13][14] - Operating margin improved by 140 bps year-over-year to 75%[13][14] - Earnings per share (EPS) increased by 24% to $051, compared to $041 in the previous year[13] Brand Performance - Old Navy Global comparable sales increased by 3%[66] - Gap Global comparable sales increased by 5%[66] - Banana Republic Global comparable sales were flat at 0%[66] - Athleta Global comparable sales decreased by 8%[66] Financial Position - Cash, cash equivalents, and short-term investments totaled $22 billion, up 28% year-over-year[34] - Inventory increased by 7% year-over-year due to earlier receipts and faster transit times[34] - Capital expenditures for the quarter were $83 million[34] Capital Allocation - The company is targeting approximately $600 million in capital expenditures for fiscal year 2025[37] - $61 million was returned to shareholders in dividends during the quarter[39] - 4 million shares were repurchased for $70 million in the first quarter[39] Fiscal Year 2025 Outlook - Net sales are projected to grow by 1% to 2% year-over-year[43] - Operating income is expected to grow by approximately 8% to 10% year-over-year, excluding potential tariff impacts[43][44]

Company Overview - Proactive is a financial news publisher that provides fast, accessible, informative, and actionable business and finance news content to a global investment audience [2] - The company has a team of experienced news journalists who produce independent content across various financial markets [2] Market Focus - Proactive specializes in medium and small-cap markets while also covering blue-chip companies, commodities, and broader investment stories [3] - The content includes insights across sectors such as biotech and pharma, mining and natural resources, battery metals, oil and gas, crypto, and emerging digital and EV technologies [3] Technology Adoption - Proactive is recognized for its forward-looking approach and enthusiastic adoption of technology to enhance workflows [4] - The company utilizes automation and software tools, including generative AI, while ensuring that all content is edited and authored by humans [5]

Exhibit 99.1 Gap Inc. Reports First Quarter Fiscal 2025 Results Net sales increased 2% versus last year with comparable sales up 2% 9th consecutive quarter of market share gains • Net sales of $3.5 billion were up 2% compared to last year. Comparable sales were up 2% year-over-year. • Store sales were flat compared to last year. The company ended the quarter with about 3,500 store locations in over 35 countries, of which 2,496 were company operated. • Online sales increased 6% compared to last year and repr ...